MIDDLE EAST

* The Central Bank of the United Arab Emirates raised by 25 basis points to 2% the repo rate applicable to borrowing short-term liquidity from the bank against certificates of deposit, effective March 22, following a similar rate hike by the U.S. Federal Reserve. The Central Bank of Kuwait and the Central Bank of Bahrain also raised their policy interest rates by 25 basis points.

* Ahead of the Fed meeting, the Saudi Arabian Monetary Authority raised its repo rate to 225 basis points from 200 basis points and the reverse repo rate to 175 basis points from 150 basis points.

* The Gulf insurance sector is expected to see more M&A activity in 2018 as stricter underwriting rules pose more and more operational challenges on smaller insurance firms, Thomson Reuters' Zawya reported, citing Mohammed Ali Londe, assistant vice president at Moody's.

* The Central Bank of the UAE is poised to launch a new system of setting the Emirates Interbank Offered Rates on April 15, in a bid to make the system operate more closely in line with market conditions and more transparently.

* A consortium led by Dubai Investments PJSC will set up a wholesale Islamic financial institution called Arkan Bank. The new bank will start operations with $100 million of initial paid-up capital and an authorized share capital of $500 million and is eyeing a listing on Nasdaq Dubai exchange within 12 months of its creation.

* Takaful Emarat Insurance PSC named Fadi Hindi CEO.

* UAE-based First Abu Dhabi Bank PJSC obtained a commercial banking license from the Saudi Arabia Monetary Authority, which would allow the bank to open up to three branches in the country.

* Qatar urged U.S. authorities to investigate First Abu Dhabi Bank unit NBAD Americas on suspicion of manipulating the Qatari riyal amid a standoff between Qatar and a group of Arab states. The bank denied the allegations.

* Doha Insurance Group QPSC plans to open representative offices in London and Beirut, which will underwrite reinsurance business such as energy risks and life and medical insurance, according to Chairman Sheikh Nawaf bin Nasser bin Khaled al-Thani.

* The Saudi Arabian Monetary Authority has instructed banks to change how their loan-to-deposit ratios are calculated in a bid to allow more lending, Reuters reported, citing financial news website Maaal. The new rules are set to be implemented in early April.

* Islamic Development Bank issued a $1.25 billion sukuk, its first benchmark public issuance in 2018.

* Saudi Arabian government agencies have reportedly been instructed not to renew some nonessential contracts with German companies after diplomatic relations between the two trading partners soured in late 2017, insiders told Bloomberg News.

* Moody's lowered the long-term issuer and senior unsecured bond ratings of Oman to Baa3 from Baa2, maintaining a negative outlook, citing the country's deteriorating fiscal and external metrics due to institutional and policy constraints. Subsequently, the agency downgraded certain ratings and assessments of seven Oman-based banks, including Bank Muscat SAOG and Bank Dhofar SAOG.

* National Finance Co. SAOG's board approved the appointment of Shahin Al Balushi as new CEO, replacing Robert Pancras.

* Oman's National Life and General Insurance Company SAOG opened its first office in Kuwait.

* The Central Bank of Oman raised the rate of interest payable on capital deposits to 1.5% per annum from 1% per annum, retroactively effective from Jan. 1.

* Bahrain-based wholesale lender United Gulf Bank BSC (c)'s holding of 192,395,274 shares in Malta-based FIMBank Plc was transferred to United Gulf Holding Co. BSC, as part of a restructuring in Kuwait Projects Co. (Holding) KSC As a result, United Gulf Holding Co. now holds a 61.17% stake in FimBank.

* Israel's Ofer family agreed to divide its assets in Mizrahi Tefahot Bank Ltd. and real estate firm Melisron Ltd. among its members to comply with the country's competition law.

* Dexia SA unit Dexia Crédit Local SA agreed to sell its entire 58.9% stake in Dexia Israel Bank Ltd. to qualified investors for 674 Israeli shekels per share, or a total of approximately €82 million.

* The European Bank for Reconstruction & Development completed an equity investment in Bank Audi SAL, taking approximately 2.51% of the Lebanese bank's total common shares outstanding.

NORTH AFRICA

* Morocco's central bank kept its key rate unchanged at 2.25%.

* Fitch Ratings said insurers in Morocco are likely to gradually reduce their exposure to equity and hold more government bonds when the country's new risk-based solvency regime comes into force.

* Egypt's finance ministry said Banque du Caire SAE and Misr Insurance Co. are among 23 state-owned companies that will sell stakes beginning in 2018 as part of the government's plan to raise 80 billion Egyptian pounds through minority share offerings on the Egyptian Exchange, Reuters reported. Finance Minister Amr el-Garhy said the first share offering from an unspecified company would be held in the next two to three months.

* CI Capital Holding Co. SAE said it intends to list its shares on the Egyptian Exchange through an IPO. The Egyptian investment bank will offer up to 246.9 million ordinary shares, representing up to 43.6% of its share capital following completion of the IPO and a capital increase.

* Moody's lowered its long-term issuer rating on Tunisia to B2 from B1, citing "continued deterioration" in the country's fiscal strength and wide external imbalances. The rating agency also changed its outlook to stable from negative. Subsequently, the agency took actions on five Tunisian lenders, including Arab Tunisian Bank and Banque Internationale Arabe de Tunisie SA.